Page 20 - ePaper
P. 20
Employment and Social Developments in Europe 2014
Skills mismatches Chart 9: Economic sentiment and employment, changes between
the second half of 2012 and the first quarter of 2014
Skill mismatch – the discrepancy 6
between the qualifications and skills HR
that individuals possess and those that 4 LU HU
are needed by the labour market – is a 2 LT MT UK
structural problem. Due to the intense 0 SK SE PL DE CZ BE
job destruction and its concentration in -2 LV EE FR DK EU
certain branches of economic activity a % change in employment, 14Q1/12H2 -4 FI BG AT NL SI ES IT PT
strong increase in structural mismatch
has taken place since the start of the -6 CY EL
crisis. The evidence set out below points -8
to increasing levels of skills mismatch -10 RO
in the EU, further aggravating current -12
27
labour market difficulties ( ). 0 5 10 15 20 25 30 35
% change in sentiment, 14Q1/12H2
In this context, the upward shift in the EU Source: Eurostat, ei_bssi_m_r2 and lfsi_emp_q.
Beveridge curve (with a higher indicator
for labour shortage for a given unem- Chart 10: Beveridge curve for the EU
ployment rate) suggests more labour
market mismatches (see Chart 10). 12
These mismatches are mostly linked to
skills, as it seems that the sectoral mis- 10 08Q1
match follows a cyclical pattern (Arpaia
et al., 2014). 8 14Q1
Table 1 shows that, when comparing Labour shortage indicator 6 11Q1 12Q1 13Q1
the period since 2010 with 2008-09, 4
the Beveridge curves for about half 09Q1
of the Member States seem to have 2
remained stable. This includes a group 10Q1
of Member States which had seen a 0
9.5
8.5
continuous increase in unemployment 6.5 7.5 Unemployment rate (%) 10.5 11.5
until recently and for which it might be
still too early to assess the possibility Source: Eurostat, ei_bsin_q_r2 and une_rt_q.
of a shift in their curve (Greece, Spain, Note: The labour shortage indicator is the % of manufacturing firms pointing to labour shortage as a
Cyprus and Portugal). However, the factor limiting production.
other half (including most of the large
Member States) saw an outward shift, Table 1: Shifts in Beveridge curves between 2008-09
while an inward shift was only seen in and 2010-14Q1
28
Germany ( ).
Shift? A given unemployment rate goes Valid for the following Member States:
A serious mismatch in skills inevita- together now with a … (EU) BG, DK, EE, FR, HR, IT, LV, LT, NL, PL, SI,
bly affects economic competitiveness higher indicator of labour shortage SK, UK
and growth, increases unemployment, similar level of the indicator of labour BE, CZ, EL, ES, CY, LU, HU, MT, AT, PT, RO,
undermines social inclusion, and gen- shortage FI, SE
erates significant economic and social lower indicator of labour shortage DE
costs. This is a serious matter of con-
cern given that one in three European
employees is considered to be either the jobs that they do, with the mismatch rigid and segmented labour markets,
29
over-qualified ( ) or under-qualified for being especially high in Mediterranean with the impact mainly affecting younger
countries (Chapter 6 in European Com- male workers on non-standard contracts.
( ) See Chapter 6, ‘The skill mismatch challenge
27
in Europe’ in European Commission (2013c). mission, 2013c).
( ) In the absence of structural changes, the The skills mismatch is not only a current
28
unemployment rate and the vacancy rate Countries with high rates of over-quali- problem, however, since it risks becom-
(approximated here through the labour 30
shortage indicator), would move along the fication ( ) share some common charac - ing bigger over time when the recovery
curve during economic cycles. A booming teristics. They tend to have lower levels accelerates and broadens, and new jobs
economy then sees a lower unemployment
rate associated with a higher vacancy rate of public investment in education and will require new skills which are not nec-
and vice versa in case of a downturn. training, lower levels of expenditure on essarily available in sufficient numbers.
29
( ) ‘Over-qualified’ does not mean that too labour market programmes, and more
much has been invested in the worker’s
human capital, just that their current An effective reduction in the level of skills
employment does not make sufficient use ( ) Countries with high over-qualification rates mismatch requires action on both the
30
of the skills and competences they have are Greece, Italy, Portugal, Cyprus, Lithuania,
acquired. Spain and Ireland. supply and demand side. In this respect
18
Skills mismatches Chart 9: Economic sentiment and employment, changes between
the second half of 2012 and the first quarter of 2014
Skill mismatch – the discrepancy 6
between the qualifications and skills HR
that individuals possess and those that 4 LU HU
are needed by the labour market – is a 2 LT MT UK
structural problem. Due to the intense 0 SK SE PL DE CZ BE
job destruction and its concentration in -2 LV EE FR DK EU
certain branches of economic activity a % change in employment, 14Q1/12H2 -4 FI BG AT NL SI ES IT PT
strong increase in structural mismatch
has taken place since the start of the -6 CY EL
crisis. The evidence set out below points -8
to increasing levels of skills mismatch -10 RO
in the EU, further aggravating current -12
27
labour market difficulties ( ). 0 5 10 15 20 25 30 35
% change in sentiment, 14Q1/12H2
In this context, the upward shift in the EU Source: Eurostat, ei_bssi_m_r2 and lfsi_emp_q.
Beveridge curve (with a higher indicator
for labour shortage for a given unem- Chart 10: Beveridge curve for the EU
ployment rate) suggests more labour
market mismatches (see Chart 10). 12
These mismatches are mostly linked to
skills, as it seems that the sectoral mis- 10 08Q1
match follows a cyclical pattern (Arpaia
et al., 2014). 8 14Q1
Table 1 shows that, when comparing Labour shortage indicator 6 11Q1 12Q1 13Q1
the period since 2010 with 2008-09, 4
the Beveridge curves for about half 09Q1
of the Member States seem to have 2
remained stable. This includes a group 10Q1
of Member States which had seen a 0
9.5
8.5
continuous increase in unemployment 6.5 7.5 Unemployment rate (%) 10.5 11.5
until recently and for which it might be
still too early to assess the possibility Source: Eurostat, ei_bsin_q_r2 and une_rt_q.
of a shift in their curve (Greece, Spain, Note: The labour shortage indicator is the % of manufacturing firms pointing to labour shortage as a
Cyprus and Portugal). However, the factor limiting production.
other half (including most of the large
Member States) saw an outward shift, Table 1: Shifts in Beveridge curves between 2008-09
while an inward shift was only seen in and 2010-14Q1
28
Germany ( ).
Shift? A given unemployment rate goes Valid for the following Member States:
A serious mismatch in skills inevita- together now with a … (EU) BG, DK, EE, FR, HR, IT, LV, LT, NL, PL, SI,
bly affects economic competitiveness higher indicator of labour shortage SK, UK
and growth, increases unemployment, similar level of the indicator of labour BE, CZ, EL, ES, CY, LU, HU, MT, AT, PT, RO,
undermines social inclusion, and gen- shortage FI, SE
erates significant economic and social lower indicator of labour shortage DE
costs. This is a serious matter of con-
cern given that one in three European
employees is considered to be either the jobs that they do, with the mismatch rigid and segmented labour markets,
29
over-qualified ( ) or under-qualified for being especially high in Mediterranean with the impact mainly affecting younger
countries (Chapter 6 in European Com- male workers on non-standard contracts.
( ) See Chapter 6, ‘The skill mismatch challenge
27
in Europe’ in European Commission (2013c). mission, 2013c).
( ) In the absence of structural changes, the The skills mismatch is not only a current
28
unemployment rate and the vacancy rate Countries with high rates of over-quali- problem, however, since it risks becom-
(approximated here through the labour 30
shortage indicator), would move along the fication ( ) share some common charac - ing bigger over time when the recovery
curve during economic cycles. A booming teristics. They tend to have lower levels accelerates and broadens, and new jobs
economy then sees a lower unemployment
rate associated with a higher vacancy rate of public investment in education and will require new skills which are not nec-
and vice versa in case of a downturn. training, lower levels of expenditure on essarily available in sufficient numbers.
29
( ) ‘Over-qualified’ does not mean that too labour market programmes, and more
much has been invested in the worker’s
human capital, just that their current An effective reduction in the level of skills
employment does not make sufficient use ( ) Countries with high over-qualification rates mismatch requires action on both the
30
of the skills and competences they have are Greece, Italy, Portugal, Cyprus, Lithuania,
acquired. Spain and Ireland. supply and demand side. In this respect
18
